Why the Creso Pharma (ASX:CPH) share price is soaring 9% higher today

Legal medicinal and recreational cannabis markets are opening across the globe.
The post Why the Creso Pharma (ASX:CPH) share price is soaring 9% higher today appeared first on The Motley Fool Australia. –

The Creso Pharma Ltd (ASX: CPH) share price is soaring this morning, trading 9% higher at 12 cents apiece at time of writing.

Below, we take a look at the ASX cannabis share’s quarterly results for the period ending 30 June (Q2)

What quarterly results did Creso report?

The Creso Pharma share price is soaring after the company reported a second consecutive quarter of record revenue growth.

Revenue came in at $1.63 million, up 18% from the first quarter of 2021 and up 451% year-on-year.

The company’s Canadian cultivation and sales division, Mernova Medicinal Inc, reported a 21% increase in revenue over the previous quarter, to $966,000. It noted an ongoing shift towards a recurring revenue model with orders from returning customers and province partners.

With its acquisition of Halucenex Life Sciences Inc completed following the end of the quarter, Creso Pharma reported it’s now the “first ASX-listed company with a 100% owned psychedelics subsidiary”. It estimated the addressable market for psychedelic medicines to be worth some US$100 billion.

On the balance sheet, as at 30 June, the company had cash reserves of $13.6 million.

Cash reserves increased by $2.5 million to approximately $16 million as at 31 July as some 50.5 million options were exercised into fully paid ordinary shares. Creso expects that additional outstanding options, worth roughly $5 million, will be exercised over the next months, providing it with extra working capital.

What did management say?

Commenting on the results, Creso’s non-executive chairman Adam Blumenthal said:

This quarter solidified Creso Pharma’s intent to become a world leader in the psychedelic, CBD, and recreational and medicinal cannabis space. The successful acquisition of Halucenex is a major milestone for the company, as it looks to commercialise new psychedelic-assisted psychotherapy treatments in the future.

The merger with Red Light Holland to create The HighBrid Lab presents an opportunity to take advantage of several synergies available across the businesses, allowing the combined company to considerably scale up operations in both the near and long term.

Blumenthal highlighted Creso’s successful listing on the US over-the-counter (OTC) market. “This provides the company with exposure into a deep and liquid pool of North American investors,” he said.

Noting the continuing push towards legalisation in the US on a state-by-state basis, Blumenthal added, “The ever-changing regulatory landscape in the US will allow us to pursue synergies for the HighBrid Lab and scale up activities to further commercialise our business divisions.”

Creso Pharma share price snapshot

Over the past 12 months, the Creso Pharma share price has leapt 290% higher, compared to a gain of 27% on the All Ordinaries Index (ASX: XAO).

Year-to-date, however, Creso Pharma’s share price has gone the other direction, down 35% in 2021.

The post Why the Creso Pharma (ASX:CPH) share price is soaring 9% higher today appeared first on The Motley Fool Australia.

Should you invest $1,000 in Creso Pharma right now?

Before you consider Creso Pharma, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Creso Pharma wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

Here’s why the Creso Pharma (ASX:CPH) share price is surging 15% higher
Blazing it? How the top ASX cannabis shares performed in FY21

The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!